End of Day Recap

DO Profits Locked In

By Bryan Bottarelli
Wednesday, April 23, 2008 4:21 PM EDT
Wed, 23 Apr 2008 20:21:00 GMT

Dear Bottarelli Research Member,

With Wednesday’s trading session now in the books, we were able to successfully lock in profits on our DO May 135 Puts (DO QG).Although this will not go down as our biggest homerun winner, taking our respectable profits off the table in advance of tomorrow’s earnings report is the safe play.

The same goes for our NVDA June 20 Calls (UVA FD).While I continue to like the upside potential of NVDA going forward, it never hurt anyone locking in a quick 30% profit on HALF of your position. In a market like this, locking in profits on the eve of an earning call (like DO) and half of your profits on a really nice near-term winner (like NVDA) is always a good idea.

Looking at our other positions, we’re saw a fresh round of profit-taking in the agricultural sector today, and this is pushed names like POT and MOS down $10.00 and $7.00 respectively. As you would expect, this also pushed shares of Monsanto (MON – NYSE) lower as well, but as we’ve seen time and time again, these names do not stay down for long. If the timing is right, I may add to our MON calls — but I’ll let you know exactly when to make this play.

We’re also saw metal stocks drift lower as well, and that’s exactly why I went out into June on our ABX June 42.5 Calls (ABX FV). The stock now looks over-sold at these levels, and I’m quite comfortable holding this position for a near-term recovery.

In terms of new potential trades, I’m following an interesting chart formation on Terra Industries (TRA – NYSE). As I’ve mentioned before, TRA isn’t widely known on Wall Street yet, but it’s a wonderful combination of the fertilizer and the soft commodity sectors. As you can see, shares are testing their 50-day moving average as we speak, and if this level holds, we could have a nice upside call play on our hands. As always, I’ll carefully monitor this situation and alert you if any trading action is necessary.

TRA

We also saw a major pop in all of the Chinese-based plays — thanks to favorable new tax regulations in China. Names like ACH, FXI, and PTR (which I mentioned earlier this week) are all making strong moves today — and this could trigger a new call play as well. And as a side note, for all of you Bottarelli Research Small Cap members, this news offered a really nice boost to shares of HNP, so hopefully this is the catalyst that sparks continued upside momentum!

Until tomorrow,

Lock and load!

Sincerely,

Bryan Bottarelli

Bryan Bottarelli
Editor, Bottarelli Research

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